How Bankruptcy Affects the Future of Lordstown Endurance Electric Pickup Truck

Lordstown Motors started with a bang. His Endurance pickup was was unveiled at the White House in 2020 by President Trump praise the design. “This is incredible,” Trump said in describing the truck. Trump went on to explain the benefits the company would bring to Lordstown Ohio, with founder Steve Burns claiming 100,000 trucks would be built at the Lordstown plant. Senator Rob Portman from Ohio said that Lordstown would employ 1,100 people that year, and the area would soon be christened, “Voltage Valley”. However, Lordstown Motors did not create a “voltage basin”. None of this happened.

Lordstown did not sell 100,000 trucks. It did not employ 1,100 people. It did nothing but go bankrupt, and get sued and investigated by the SEC. However, miraculously, it seems that the Endurance picture will continue despite all this. Burns has somehow wrung the assets from the failed company, and brought them to a new home in his latest project LandX. Here’s what we know about the Lordstown debate and the future of the Endurance picture.

Lordstown Motors Filed For Bankruptcy In 2023

Lordstown Motors launched in 2018, with its Endurance Pickup scheduled to hit the market in late 2020. It then pushed back the electric truck’s release date to 2021. It then pushed the release date back to 2022, after selling its factory to Foxconn, and accepting Foxconn to be the contract manufacturer of the pickup.

Failure to reach the market undermined the entire mission of the company. Lordstown’s goal was to be the first American car to take a passenger car on the road. However, during its delay, the Electric Ford F-150 and Rivian R1T were made available to the public first. The truck actually hit the road in late 2022, but was almost immediately recalled due to a speed issue. If all this wasn’t bad enough, Lordstown filed for bankruptcy in June 2023.

Lordstown Motors Had Quality Financial Issues

Lordstown had entered into an agreement with Foxconn to receive $170M. Foxconn, however, only invested ~$57M to acquire an eight percent stake in Lordstown. Lordstown sued Foxconn over pay gap. Lordstown alleged that Foxconn repeatedly changed the requirements in the agreement to meet the payment. At the same time it filed for Foxconn, Lordstown filed for Chapter 11 bankruptcy. The company intended to be sold to a larger player in the space.

Before bankruptcy, in 2021, the research company Hindenberg published a report that blew the whistle on Lordstown’s business practices. Lordstown repeatedly claimed, even to the President of the United States, that it had orders for 100,000 trucks. However, these instructions were generally unrealistic. Many companies and consultants were paid to create orders they did not intend to fill.

Other businesses simply took advantage of the no-cost, irresponsible booking system to make themselves look good by locking in a Lordstown electric truck. Following this report sent shockwaves through Lordstown’s C-Suite. Steve Burns, the founder, sold all his shares and the CFO resigned.

Lordstown has never been a financially stable company, and once the ranks are pulled back, it appears the EV maker is closer to a fraudulent operation than a car company. Lordstown was a bellwether for the changes in the EV market. For Reuters:

“Lordstown’s bankruptcy signals that the days of successful EV startups are in the rearview mirror,” said Thomas Hayes, chairman of hedge fund Great Hill Capital. “Going forward it will be Tesla and the traditional managers … who will take it away for market share.”

This is bad news for companies like Rivian and Fisker, if this is true. However, we tend to think that other small EV makers are not quite on the level of Lordstown scams and conspiracies.

The company was sued by Karma Automotive

Beyond internal issues, Lordstown also had problems with other EV companies. Karma, a green car manufacturer, claimed so Lordstown hunted employees from Karma and steal trade secrets as well. Karma originally sued Lordstown for $900M. However, after the news of bankruptcy, Karma accepted the $40M settlement. Instead of trying to pay the cash-strapped company out of money it didn’t have, Karma took what it could get, including $5M ​​in royalties for use of the infotainment technology.

Related

The Future of Electric Pickup Trucks

Electric trucks already exist with different hybrid and full EV models, but what does this mean for the future?

Lordstown Also Has Chased The SEC

Lordstown’s troubles don’t end with lawsuits and bankruptcies. We cannot claim to know whether Lordstown is guilty, but it has certainly been accused of committing crimes against its investors. Here’s what we know about SEC costs.

Company Sued For Misleading Investors

The SEC has stated the following on the actions of Lordstown:

“We contend that, in the highly competitive race to deliver the first mass-produced electric pickup truck to the U.S. market, Lordstown delivered on the true needs of the Endurance,” said Mark Cave, Associate Director of Operations. “Exaggerations that misrepresent a public company’s competitive advantages distort capital markets and undermine the ability of investors to make informed decisions about where to put their money.”

The SEC announced this payment on February 29, 2024. So, almost a year after the bankruptcy, the hits keep coming to Lordstown. Not only did Lordstown have to pay millions in court fees and debts, it is now dealing with criminal charges for its homegrown business practices. I

In this SEC case, Lordstown has already agreed to pay $25.5M to the SEC for a cease and desist order. However, this payment does not constitute an agreement or rejection of the SEC’s findings. The SEC investigation is still ongoing, and there is no telling where this may end.

Related

Why Lordstown’s Fall Is a Breath of Relief for All Electric Truck Manufacturers

While Lordstown Motors has been in hot water for a while, it looks like the EV truck segment may have lost its all-electric pickup truck.

Lordstown Endurance Can Go On

Despite all of this mischief, the Endurance pickup truck isn’t quite dead yet. In fact, it looks like Lordstown itself is not dead. Lordstown has emerged from bankruptcy, as a a new organization called NuRide.

NuRide is already trading on the stock market and opened at $2.80 per share. Not only does the original Lordstown company live, but so does Endurance. Because of a potential buyout during bankruptcy, the Endurance picture will still be released, albeit under a new name.

Steve Burns, Founder of Lordstown, Has Purchased Assets From Bankruptcy and Launched LandX, EV.

Steve Burns founded Lordstown, and he’s not done with his pursuit of an electric pickup truck. In January 2024, Burns announced that he had started a new EV startup called LandX. LandX claims to be the “future of mobility”. This is a ridiculous claim, since the basis of the entire company is a voting system that could not reach the market before its competitors.

It is not entirely clear what the market plan for LandX is. It doesn’t even have a new name for its takeover. It doesn’t have a price, an ordering system, or even a way to build the truck, as Foxconn currently owns the factory that built the Endurance, not the NuRide or LandX.

It seems unlikely that Foxconn would enter into a contract with a company that is closely related to the one that sued them within the last twelve months, and is run by someone who has not been able to deal adequately with Foxconn in EV manufacturing in the past.

LandX Are Pickup Trucks Equal to Endurance

Turn on LandX website, there are pictures and videos involving Endurance. This isn’t just an Endurance-like truck, or one that uses the same body, it has the Lordstown logo right on the site. This is very confusing, as LandX appears to be a completely new company to the failed Lordstown, and a new company, NuRide.

In short, we’re not sure what’s going on with Endurance. We don’t know what the future holds for Endurance because Steve Burns hasn’t made any concrete moves about what will happen to the truck. The new company LandX seems to be looking to create more electric pickups that are based on the Endurance model, but if it will be the exact same truck (with the name) we are not sure. Unfortunately, almost every party involved here is a mess, and it’s hard to see the future with these players.